Index heavyweight BHP Billiton was the biggest gainer, up half a percent on gains in oil prices.

Oil prices rose on Wednesday, supported by increasing confidence that an OPEC-led production cut aimed at tightening the market would be extended through the rest of 2017 and the first quarter of next year.

Three of the 'Big Four' were marginally lower, while Commonwealth Bank of Australia rose 0.1 percent.

The banking sector has more downside risks than upside due to stretched valuations, rising cost of funds, low credit growth and the bank tax that is likely to increase over time, Blue Ocean Equities said in a note.